05 Oct 2023 -

TSMC to help Europe break its Asia chip dependency

semiconductor manufacturing

In the midst of the global tech turmoil, a significant shift is underway in Europe’s semiconductor landscape, spearheaded by Taiwan Semiconductor Manufacturing Company (TSMC). While Dutch manufacturer ASML occupies the epicenter of the US-China trade and technology conflict due to its dominance on advanced semiconductor lithography equipment (EUV), most European semiconductor players have largely maintained a low profile.

At present, Europe’s leading semiconductor giants include Germany’s Infineon, Switzerland’s STMicroelectronics, and the Netherlands’ NXP, ranking 9th, 10th, and 12th globally in terms of sales. However, recent figures reveal that Infineon’s sales in the second quarter of 2023 were merely 35% of Intel’s, underscoring the considerable gap in market influence.

In July, during a visit to Belgium’s Inter-University Microelectronics Center (IMEC), European Commission President Ursula von der Leyen articulated a pressing concern. She emphasised the necessity of reducing Europe’s dependency on a handful of suppliers from East Asia while actively mitigating risks within the semiconductor supply chains.

It’s an undeniable fact that Europe’s semiconductor industry is comparatively small. Data from market research and industry organisations corroborate this, indicating that just 5% of global semiconductor production capacity resides in Europe. Furthermore, European companies account for a mere 9% of global chip sales, even though Europe purchases approximately 20% of the world’s semiconductors.

To confront this glaring disparity head-on, von der Leyen champions a bold strategy. She asserts that Europe must foster the complete semiconductor ecosystem, encompassing design, testing, and production, all within the continent’s boundaries. To achieve this ambitious goal, the European Chips Act emerges as the game-changing catalyst.

With TSMC’s involvement in the European semiconductor landscape, there’s a palpable sense of momentum. Breaking free from the shadows of industry giants in Asia, Europe is poised to redefine its role in the semiconductor arena. As the continent seeks to bolster its chip production and reduce its reliance on external suppliers, the stage is set for a semiconductor resurgence that could reshape the global tech landscape.

Europe’s bid to carve out a more prominent place in the semiconductor industry is a story worth watching, as it unfolds against the backdrop of a rapidly evolving tech world.

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